Defence Committee Press Notice

Main Estimates shows rising cost for Afghanistan only just offset by reduction in Iraq costs

This Report is published just before the House of Commons is asked later today to approve the Government’s expenditure plans for the current financial year (the Main Estimates).

In its Report, the Committee:

welcomes the MoD’s move to include operational costs in the Main Estimates for the first time, and praises the Department for the increasing amount of information relating to operational costs it places before Parliament at an earlier point in the Financial Year.

sets out the Ministry of Defence’s request for resources of £39.7 billion, of which £4.37 billion are for operational costs in Iraq and Afghanistan. These costs are 3.2% down on the latest operational forecasts for the previous Financial Year, on account of drawdown in Iraq. Over this Parliament, operational costs have risen from £1.16 billion in 2005-06 to an estimated £4.52 billion in 2008-09. Costs for Afghanistan have risen from £2.56 billion forecast for the last Financial Year to £3.5 billion forecast for this.

expresses concern that the MoD is now having to bear the full cost of any spending on Urgent Operational Requirements over the limit set by the Treasury and the Department whereas previous practice allowed for any excess to be split 50:50 between them.

The Chairman of the Defence Committee, the Rt Hon James Arbuthnot MP, says: “We are calling on the House to approve the MoD’s Main Estimates. For the first time at this stage in the Financial Year, the House can see in some detail what the MoD expects operational costs to be. Clearly, there is no likelihood that the cost for operations in Afghanistan will fall over the short to medium term, and we are concerned about arrangements for Urgent Operational Requirements which may lead the MoD in years to come to bear more costs previously funded from the Reserve.”

NOTE FOR EDITORS:

The Committee was nominated on 13 July 2005. The Defence Committee is appointed by the House of Commons to examine the expenditure, administration, and policy of the Ministry of Defence and its associated public bodies.